At Vintage Real Estate, we have had our finger on the pulse of the Tampa real estate market for almost two decades. Our team of expert real estate agents and property managers live locally and therefore have a unique understanding of regional market trends. We can provide insights more specific to the Tampa area than national real estate corporations and media outlets. Recently, we have noticed a discrepancy between how the Tampa real estate market is being reported by these corporations and media outlets and the reality on the ground. In this blog, we aim to set the record straight and provide an accurate update on the current state of the Tampa real estate market.
Has the Tampa real estate market cooled down?
The answer to this question is a resounding, definite “yes.” The Tampa housing market experienced a surge in the fourth quarter of 2021 and the first quarter of 2022, with an 8% increase in home listing prices. Average days on the market reduced to 36 days, indicating high demand and low inventory. Our market shifted exceptionally quickly and positively, and our real estate investor clients enjoyed soaring profits on their Tampa real estate market investments. However, the market has now slowed down significantly, and we are seeing a difference compared to this time last year. Despite this, we continue to see news stories daily claiming that the Tampa real estate market is "hot” and insinuating it continues to be on the same upswing as last year. While the market is more robust than it was a few years ago, it is important to note that it has cooled off from its peak. This discrepancy between media reports and reality can create unrealistic expectations for owners and investors, leading to ill-informed real estate investment strategies.
Working in your best interests
As a full-service real estate brokerage and property management company, we work with both experienced and first-time real estate investors to help them find and rent properties in the Tampa Bay area. Our business model is based on the principle that "we win when you win." As property managers, we are only paid when you are, so it is in our best interests to help you make sound real estate investment decisions. Unlike some real estate agents who may have incentives to overpromise on the rental potential of a property, our property management fees are based on collected rent, not just on listing a property.
When it comes to real estate investing, it is essential to work with a brokerage you can trust to give you honest and accurate information; nobody wants sugarcoating when it comes to making investments in the hundreds of thousands or millions of dollars range. At Vintage Real Estate, we are committed to providing our real estate investor clients with reliable and timely information about the state of the Tampa market. Our team is here to advise you and guide you through making informed real estate investment decisions, from property selection to finding quality tenants and negotiating favorable lease terms to rent collection and ongoing maintenance.
Tampa real estate data points to consider
Our opinion is that news outlets are stuck in 2022 mode when reporting on the Tampa real estate market. According to Vintage Real Estate founder Dave Sigler. “the media is still in this mindset that rents are on the rise and sales are great - the reality is they are not. Rents are declining, sales are suffering”. As previously stated, the Tampa market, in general, is strong compared to several years ago, but the idea that we’re still on the high from 2022 is simply not accurate. According to Zillow, there are currently 1171 homes for sale in Tampa that have been on the market for 30 days or longer, 699 of which have been sitting for 45 days or longer and 488 for over 60 days.
The housing market in Tampa has declined significantly since last year when it was at its historical peak. This can be seen in the data from September 2022 from the Greater Tampa Realtors, which found that the one-year change in closed sales was down 36.2%, while the one-year change in active listings was up 96.9%. The median sale price for Tampa, Saint Petersburg, and Clearwater has stayed flat month-over-month. The number of pending home sales has also decreased for six months straight as higher interest rates and recession fears dampen the housing market.
The average 30-year fixed mortgage rate stands at about 6.42%, according to the Mortgage Bankers Association. This rate is down from October when rates crossed 7% for the first time in 20 years, but it is still nearly double what it was this time last year. This increase in mortgage rates has made it more difficult for buyers to purchase homes.
The decrease in the housing market can also be seen in the median sales price of short sales, which has decreased by 101.7%. This decrease in short sale prices indicates that buyers are not as excited as they were last year, nor is the sense of urgency to buy. Furthermore, investor purchases of homes in the greater Tampa Bay region have declined 13% since last summer.
Is Tampa still a good place to invest in real estate?
Despite the declining real estate market in Tampa, it remains a good investment region. Even with recent changes, it is still one of the hottest US real estate markets, with a good chance of solid appreciation in the coming years. Additionally, the average rent in Tampa is still much lower than the national average. According to Zillow, the median rent in Tampa is $1,745 compared to the national average of $2,125, making Tampa a desirable place to live for renters and a desirable place to buy-to-rent for investors.
At Vintage Real Estate, we are passionate about working with investors to find, purchase, and rent out investment properties in and around Tampa Bay. Contact us today to start a conversation and feel confident you’re making informed decisions about your real estate investment portfolio.